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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: This week, at every major port along the East and

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Speaker 2: Gulf coasts of the United States work ground to a halt.

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Speaker 1: We run these dots? Who runs the gots?

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Speaker 2: The forty seven thousand DOC workers in the International Longshoreman's

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Speaker 2: Association went on strike Monday night, demanding a pay raise

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Speaker 2: of seventy seven percent over the next six years, as

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Speaker 2: well as strict limitations on automation at the ports. The

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Speaker 2: ports the strike shutdown handle nearly half of the containers

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Speaker 2: that come in and out of the US every day.

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Speaker 1: From Houston, New Orleans, Mobile, Alabama, a bunch of ones

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Speaker 1: in Florida, you know, Georgia, South Carolina, North Carolina, Virginia,

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Speaker 1: and all the way up to New York.

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Speaker 2: Laura Curtis covers ports for Bloomberg, and she's had a

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Speaker 2: whirlwind of a week because on Thursday Day night, after

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Speaker 2: days of seemingly deadlock negotiations, the dock workers struck a

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Speaker 2: tentative deal with the US Maritime Alliance, which represents the

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Speaker 2: shipping companies, And just like that, the strike was over. Today,

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Speaker 2: the ports are once again open for business, and a

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Speaker 2: potential crisis was averted. One that could have caused chaos

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Speaker 2: for companies, consumers, and the entire US economy. It could

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Speaker 2: even have affected the outcome of the presidential election. Crisis

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Speaker 2: averted for now anyway.

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Speaker 1: It was really kind of a will promise to pay

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Speaker 1: you this much in the next round while we continue

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Speaker 1: to work out the tougher issues so that we can

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Speaker 1: get back to work.

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Speaker 2: Under the terms of the tentative deal, the dock worker's

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Speaker 2: current contract has been extended until January fifteenth. The shipping

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Speaker 2: companies agreed to a substantial race sixty two percent over

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Speaker 2: the term of the dock worker's next six year contract.

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Speaker 2: But this agreement is tentative, meaning that until January fifteenth,

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Speaker 2: the dock workers will keep the ports open while they

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Speaker 2: continue to negotiate other terms of their contract. Now, the

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Speaker 2: question is will the longshoremen and the shipping companies be

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Speaker 2: able to come to a solid deal before their contract

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Speaker 2: expires in the new year. Today, on the show, what

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Speaker 2: drove tens of thousands of dock workers to go on strike,

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Speaker 2: how the strike got paused, and why the fight against

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Speaker 2: automation at ports could bring the longshoremen back to the

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Speaker 2: picket lines next year. This is the big take from

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Speaker 2: Bloomberg News. I'm Sarah Holder. Last night, a massive strike

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Speaker 2: that shut down every major port on the East Coast

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Speaker 2: and Gulf Coast of the US suddenly ended. Laura Curtis,

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Speaker 2: who's been covering the strike for Bloomberg, says that the

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Speaker 2: resolution brought a lot of people a sense of relief.

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Speaker 1: So the dockworkers went on strike on Monday night into

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Speaker 1: Tuesday morning in affected ports all up and down the

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Speaker 1: Eastern Seaboard that typically process about fifty percent of US

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Speaker 1: imports and exports. So everybody was really concerned about how

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Speaker 1: long it would last and what the overall impact to

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Speaker 1: the economy would be.

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Speaker 2: The International Longshoremen's Association, or the ISLA, was asking for

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Speaker 2: a seventy seven percent raise over six years, and also

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Speaker 2: strict limits on the use of automation at ports, including

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Speaker 2: for things like gates, cranes, and trucks.

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Speaker 1: It's important to keep in mind too, you know, they

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Speaker 1: the last time they negotiated wages was six years ago.

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Speaker 1: A lot has changed since then. Inflation has taken a

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Speaker 1: huge bite out of that paycheck. In addition to that,

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Speaker 1: they worked really hard through the pandemic, and so their

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Speaker 1: position has been we deserve a share of the profits

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Speaker 1: that these shipping companies earned on their backs, basically, and

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Speaker 1: then it started. I started hearing more about more intractable

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Speaker 1: things like automation and the use of technology, and the

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Speaker 1: really deeply instilled fear that you know, robots were going

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Speaker 1: to take over their jobs.

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Speaker 2: Those dock workers were facing off with an organization known

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Speaker 2: as the US Maritime Alliance or USMX. It's a group

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Speaker 2: of shipping lines and companies that operate port terminals. Most

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Speaker 2: of the companies are based overseas. At first, USMX offered

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Speaker 2: workers a forty percent raise, but the union rejected the

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Speaker 2: offer and kept pushing for more for consumers and businesses.

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Speaker 2: The strike, which threatened to drag on for weeks, brought

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Speaker 2: to mind one thing the log jams usport's experience during

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Speaker 2: the pandemic. Logjams that saw ships full of containers sitting

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Speaker 2: idle offshore for weeks, causing store shelves to sit empty,

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Speaker 2: factories to grind to a halt, and prices to begin

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Speaker 2: an upward climb that the US economy is still grappling with.

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Speaker 1: I mean, they had, you know, millions of dollars cargo

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Speaker 1: that was stranded in these containers on the vessels and

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Speaker 1: just weren't sure when it was going to come. Presented

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Speaker 1: a lot of planning difficulties. And I think the other

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Speaker 1: part of this that is interesting, Even though it didn't

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Speaker 1: go on too long, you started to see some kind

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Speaker 1: of psychological impacts in the public. People were starting to

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Speaker 1: panic by things like toilet paper and paper towels, and

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Speaker 1: we were starting to see things that reminded us a

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Speaker 1: little bit of the pandemic. And you know, I had

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Speaker 1: one colleague who was like, this is too soon, you know,

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Speaker 1: it's this is PTSD. I don't know, this is too much.

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Speaker 1: She heard from a friend that there was no paper

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Speaker 1: towels that her supermarket left, and just that kind of thing.

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Speaker 2: Shivers run through you thinking about that time.

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Speaker 1: Yeah, absolutely, like we're not ready, you know. So it

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Speaker 1: was not just about the impact that it had, but

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Speaker 1: I think the fear around it.

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Speaker 2: The timing was delicate. With a critical presidential election just

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Speaker 2: four weeks away, Having the ports closed and shortages looming

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Speaker 2: would look bad for Biden and for Harris, but so

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Speaker 2: would using presidential powers to stop a strike. So the

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Speaker 2: White House had been putting pressure on both sides to

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Speaker 2: come to a deal, and then last night, as suddenly

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Speaker 2: as the strike had started, it ended.

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Speaker 1: So Thursday night we started hearing rumors that they may

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Speaker 1: be close to some kind of agreement, not on the

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Speaker 1: formal long term contract, but just something that would get

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Speaker 1: us through and reopen the ports, get cargo flowing again.

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Speaker 2: Where were you when you heard the news?

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Speaker 1: Where was I? I was in my bedroom. I was

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Speaker 1: working really hard remotely and trying to figure out kind

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Speaker 1: of where the news was going to come from. I

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Speaker 1: was working with my colleagues in the White House. I

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Speaker 1: was working with my colleagues in New York. I was

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Speaker 1: working with photographers that we had dispatched to the picket

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Speaker 1: lines and some reporters. We sent two places like Wilmington,

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Speaker 1: North Carolina, where there was a port there that was affected,

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Speaker 1: and talking to local longshorman.

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Speaker 2: It was not the seventy seven percent raise the dock

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Speaker 2: workers had initially demanded, but it was a major raise

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Speaker 2: sixty two percent over the life of the new six

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Speaker 2: year contract.

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Speaker 1: And that will kick in in when the next contract starts.

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Speaker 1: Right now, they've agreed to continue working under the previous

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Speaker 1: contract until January fifteenth.

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Speaker 2: For now, the ports are back up and running. The

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Speaker 2: election will be decided before the dock workers' contract expires again,

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Speaker 2: but one of the key issues that drove doc workers

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Speaker 2: to strike, automation, likely won't be resolved by next year.

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Speaker 1: The isle's president, Harold Daggett, has said several times that

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Speaker 1: he won't accept any deal that allows automation.

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Speaker 2: Will get to how the tentative deal was reached and

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Speaker 2: what sticking points remain after the break. When the dock

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Speaker 2: workers went on strike earlier this year, the nation braced

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Speaker 2: for the supply chain snarls and shortages we all experienced

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Speaker 2: during the pandemic. The strike was costing the US economy

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Speaker 2: and estimated three to five billion dollars a day, and

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Speaker 2: there were worries those costs could mount if the strike

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Speaker 2: dragged on. Editor Laura Curtis prepared for weeks of breaking

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Speaker 2: news updates as the story unfolded, and she took calls

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Speaker 2: from sources across the country late into the night.

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Speaker 1: It was getting a little bit stressful, you know, even

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Speaker 1: from my bedroom.

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Speaker 2: But it didn't take weeks, it took days. I asked

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Speaker 2: Laura how the dock workers and the shipping companies reached

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Speaker 2: a tentative resolution so quickly.

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Speaker 1: Well, There are a couple of things I think that

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Speaker 1: may have helped in a weird way. The biggest one

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Speaker 1: being the hurricane that hit huge parts of the areas

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Speaker 1: that are affected by the strike right. Hurricane Helene wiped

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Speaker 1: out parts of North Carolina, really hit Florida hard. We

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Speaker 1: had Governor DeSantis declaring that he was going to send

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Speaker 1: the National Guarden to reactivate the port somehow or at

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Speaker 1: least to help out wherever they could. And so I

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Speaker 1: think Biden's aids were successful in bringing that to the

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Speaker 1: attention of both sides and saying, listen, this is not

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Speaker 1: helping with her Kane recovery, This is not fair, this

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Speaker 1: is unsafe, and I think that message got through. Neither

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Speaker 1: side wanted to be seen as imperiling an already imperiled situation.

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Speaker 2: Laura says. Her sources also revealed that both sides of

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Speaker 2: the port negotiations were under extreme pressure to make a

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Speaker 2: deal as quickly as possible. The White House was pushing

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Speaker 2: for a resolution behind the scenes.

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Speaker 1: We now know from sources the USMX board was convened

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Speaker 1: yesterday morning, and Biden's top economic advisor, Layel Brainerd, was

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Speaker 1: the one who's sort of dispatched to put the screws

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Speaker 1: on them and to work with them and to educate

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Speaker 1: them about what's at stake. Here. On the other side,

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Speaker 1: we had Acting Secretary Julie Sue who traveled to New

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Speaker 1: Jersey yesterday and met with union leaders to try to

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Speaker 1: convey the same message. We knew that Biden really really

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Speaker 1: didn't want to break the strike, and that was something

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Speaker 1: that they kept communicating to both sides.

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Speaker 2: He could have broken the strike using a power called

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Speaker 2: taft heartly to force the union back to work for

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Speaker 2: a period of eighty days, but you're saying he did

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Speaker 2: not want to do that.

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Speaker 1: He did not want to do that. It would be

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Speaker 1: a terrible look politically for him to break a strike

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Speaker 1: you just weeks away from an election where getting the

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Speaker 1: union vote and the working class vote is so important.

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Speaker 1: We also heard from the ISLA President Daggett that if

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Speaker 1: Biden did invoke that power, he would have directed his

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Speaker 1: longshoreman to slow the role at the ports. I think

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Speaker 1: he said he would reduce efficiency. So it was never

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Speaker 1: a good option for Biden to even threaten that.

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Speaker 2: Talk about Harold Daggett for a second. He's something of

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Speaker 2: a colorful guy, he's the head of the International Longshoreman's Association,

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Speaker 2: and he's been throwing around a lot of strong language,

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Speaker 2: not only threatening to slow down shipping if Biden broke

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Speaker 2: the strike, but also saying he was going to crush

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Speaker 2: the opposition. Were you surprised that he came to the

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Speaker 2: table for this compromise to reach this steal.

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Speaker 1: I don't know. You know, I think he is a

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Speaker 1: very shrewd negotiator. I think we saw that. I think

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Speaker 1: he's the head of a very powerful union. I think

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Speaker 1: sixty two percent wage increases pretty good. You know, doc

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Speaker 1: workers on the West Coast last year got thirty two percent,

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Speaker 1: and we were all thinking it would be much closer

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Speaker 1: to that. So I'm not surprised in that way that

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Speaker 1: he agreed to go back to work under those terms. However,

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Speaker 1: the other thing about Harold Daggett is he was committed

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Speaker 1: to making the public understand his power.

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Speaker 2: Well, it seems like ultimately hitting pause on the strike

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Speaker 2: is a good thing for many parties here for now,

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Speaker 2: the workers, the economy, global commerce potentially. But is there

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Speaker 2: a concern that the union might lose some of their

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Speaker 2: leverage if they wait till January?

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Speaker 1: Absolutely they've lost some leverage just by virtue of the

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Speaker 1: election being in the past. But you know, at the

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Speaker 1: end of the day, they we've seen they can shut

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Speaker 1: down the ports. You know, they can halt about fifty

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Speaker 1: percent of US imports and exports in a day.

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Speaker 2: So they've really shown the power of their movement with

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Speaker 2: even this less than a week long strike.

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Speaker 1: Right, I think in a way they've proven their leverage.

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Speaker 2: What does this resolution or this temporary resolution mean for

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Speaker 2: the economy writ large.

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Speaker 1: Oh, it means we can keep going. Economists we're saying,

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Speaker 1: as the strike went on, we have enough reserves, retailers

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Speaker 1: have enough stockpiled goods so that we wouldn't really feel

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Speaker 1: an impact until week two of the strike. But by then,

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Speaker 1: you know, people were starting would start to get worried.

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Speaker 2: That seems to be good news for the current president,

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Speaker 2: But what does this mean for the November election.

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Speaker 1: It's really good news, not just for Biden, but for

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Speaker 1: Kamala Harris and Donald Trump. Neither of them wanted to

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Speaker 1: talk about this, neither of them wanted to face it,

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Speaker 1: neither of them really wanted to get in the middle

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Speaker 1: of it. You know, it wasn't they both want They

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Speaker 1: both need to be seen as supporting the union. But

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Speaker 1: the longer this went on, I think it would be

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Speaker 1: really hard to make the case that this was good

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Speaker 1: for every working man, or every middle class person, or

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Speaker 1: every small business. This strike, because it shut so many

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Speaker 1: crucial ports, had the potential to really impact the lives

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Speaker 1: of a lot of voters, and not just the union.

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Speaker 2: Even so, Laura says, the stickiest part of the deal

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Speaker 2: could lie ahead. What did you about automation at ports?

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Speaker 1: Now? There are some carve outs already in the existing

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Speaker 1: deal that allow for things like semi automation, which is

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Speaker 1: a crane that can be that striverlest but can be

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Speaker 1: controlled remotely by a person. That kind of thing. I

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Speaker 1: think the Mercury issuer is things around artificial intelligence and

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Speaker 1: how those types of automation might come in and impact

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Speaker 1: the jobs that the stock workers have. So that's going

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Speaker 1: to be the hardest thing for them to work out

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Speaker 1: from this point, So.

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Speaker 2: The longshore men have their wage increase, but automation is

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Speaker 2: still a huge open question. What's going to happen in January?

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Speaker 1: Well, the shipping companies and the union are going to

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Speaker 1: have to figure out a way to either agree on

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Speaker 1: what the language around automation in the existing contract means

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Speaker 1: or they're going to have to find a new way

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Speaker 1: to phrase it that everybody's happy with. You know, Harold

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Speaker 1: Daggett has been saying that he wants to tighten the

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Speaker 1: language on automation. Harold Daggett has said a lot of

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Speaker 1: different things about what he wants. I know that he

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Speaker 1: wants to take this fight globally, though, and he said

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Speaker 1: that his next stop after this is resolved is to

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Speaker 1: convene an organization of international dock workers to take on

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Speaker 1: the fight against automation, not just in the United States,

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Speaker 1: but all over the world. With the automation and artificial

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Speaker 1: intelligence piece of this is not unique to the union

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Speaker 1: or to this union. It's not unique to dock workers.

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Speaker 1: We saw it out here in Hollywood with artificial intelligence.

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Speaker 1: We're seeing it all in several of these knockdown, drag

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Speaker 1: out contract fights. So, you know, you asked if this

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Speaker 1: could happen again in six years, I think absolutely.

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Speaker 2: This is the big take from Bloomberg News. I'm Sarah Holder.

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Speaker 2: This episode was produced by Thomas lou It was edited

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Speaker 2: by Stacy Vennicksmith and Kate Davidson. It was fact checked

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Speaker 2: by Adrian A.

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Speaker 1: Tapia.

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Speaker 2: It was mixed by Blake Maples. Our senior producer is

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Speaker 2: Naomi Shavin. Our senior editor is Elizabeth Ponso. Our executive

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Speaker 2: producer is Nicole Beamster. Bor Sage Bauman is Bloomberg's head

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